It tugs at both the hip-pocket nerve and parental heart-strings and shapes debates about workforce participation and productivity. Small wonder, then, that childcare is an irresistible issue, but also a conundrum, for politicians.

It’s an issue that will become as much a part of national discussion as health and education. It could also become part of the industrial relations debate between business and government in efforts to address Australia’s sliding productivity.

As former Business Council of Australia chief
Katie Lahey
observed this week, families can expect to hear a lot more rhetoric about childcare in the countdown to the next federal election.

Both major parties will try their hardest to win over female voters because, no matter how enlightened fathers might be these days, it’s usually the woman’s wage that pays childcare costs.

For Opposition Leader
Tony Abbott
, it presents an opportunity to prove he is not stuck in a 1950s ultra-conservative mindset and that he understands the juggling act involved in modern parenting.

His first overtures came with his proposed generous paid parental leave scheme, which he is vehemently defending, despite criticism from within the Coalition, big businesses – which will be levied for it – and some mothers, who want more support to return to work.

After flagging possible support for subsidies for nannies in Sunday newspapers, Abbott says his proposed Productivity Commission review of childcare options will be focused on ensuring care is “flexible and affordable".

“Now, obviously in-home care is one of the ways in which we could be more flexible and this isn’t just nannies for lawyers and accountants," he says. “There are a lot of people who do shift work who have a number of very young children, and this may well be a better option for them."

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The Labor government, which has increased the regulation of approved childcare and enforced national quality standards, accuses Abbott of wanting to subsidise unregulated chefs and chauffeurs for the wealthy.

This has triggered accusations from the Coalition that Labor is inciting “class warfare" and does not understand the predicament of so-called working families.

It has also sparked behind-the-scenes disagreements between businesswomen’s groups that want all forms of childcare to be tax deductible so there is no longer a financial penalty for shifting from part-time work to full-time, and left-leaning women’s community groups that want more generous payments to help poorer families.

For any parents who have struggled to find and pay for childcare that matches their work commitments, the buzzwords “flexible" and “affordable" are attractive.

But parents have learned to be sceptical of politicians promising the world. A potted history of childcare promises shows the reality rarely measures up.

When the Howard government introduced the childcare rebate in 2004, there was confusion initially about whether it would cover nannies, and the Coalition had to clarify that it wouldn’t.

Support for nanny subsidies again surfaced in the Coalition in 2006, when a parliamentary committee on balancing work and family, chaired by Liberal MP
Bronwyn Bishop
, called for tax deductibility for nannies.

The same year, then Labor leader
Kim Beazley
vowed to “end the dreaded double drop-off" by supporting the construction of childcare centres at schools. The policy survived the leadership change to
Kevin Rudd
, who took it to the 2007 election, but it didn’t survive the global financial crisis.

Labor lifted the rebate from 30 per cent of out-of-pocket fees to 50 per cent. But now it has frozen the cap on claims at $7500 for each child, which compels parents to become home economists to work out whether it makes financial sense for the main carer – usually the mother – to return to work for anything more than two days a week.

The cheapest long day care costs $55 a day, but places are as rare as hen’s teeth. More commonly, parents shell out up to $135 a day, or about $35,000 a year for full-time care for one child.

For those parents paying $135 a day, which is the case in centres in the Sydney CBD, the 50 per cent rebate covers only about two days a week.

Once a family has more than one child, the financial case for a nanny becomes even more compelling. A family could pay up to $270 a day before the rebate to have two children in a childcare centre, which is more than many parents pay for a nanny to care for their children at home.

Nanny costs vary considerably but can be as little as $130 a day. As the childcare industry points out, becoming a nanny is an attractive proposition for many of its staff. Why care for five children in a centre when you can earn the same money to care for one or two children at home? But the nanny option is relatively affordable partly because it’s a largely unregulated industry, often involving cash payments that may not be declared for taxation purposes.

Subsidising nanny services would require regulation that would inevitably remove the very affordability and flexibility that has made it attractive to some parents.

There are obvious economic benefits to more flexible childcare in the home. The National Centre for Social and Economic Modelling has found there would be increased labour force participation for women, more women in higher-paid managerial positions, and more women in male-dominated industries such as trades or construction which involve inflexible or early work hours.

That’s not to mention a better life/work balance without the stress of the childcare pick-up, peak-hour traffic and grizzling toddlers. Another benefit is the convenience of having a carer come to your home and possibly also help with housework.

But should the government be subsidising such convenience? Childcare Minister
Kate Ellis
doesn’t think so, because it would be at the expense of families accessing the existing childcare rebate and the means-tested childcare benefit.

“It’s like having a BlackBerry," says Naomi Flutter, a Deutsche Bank director and mother of 19-month-old twins. “If you don’t have a BlackBerry, you can’t work from home. If you can’t get transport, you can’t get to work. If you don’t have childcare, you can’t work."